Billions may be added below the budget line

Henrik Asheim (Conservatives) budget lineHenrik Asheim (Conservatives), when he temporarily stepped in as Minister of Knowledge. Photo: Høyre/Hans Kristian Thorbjørnsen

Billions may be added below the State Budget line

Leader of Labour, Jonas Gahr Støre, is sceptical towards buying a replacement frigate or financing a revamped Government quarter with money that isn’t allocated in the ordinary Norwegian State Budget.


The platform that the Government is built on allows for upgrading the Government quarter to the tune of NOK 15 billion, or to buy a replacement for the wrecked frigate, KNM Helge Ingstad, at a “mere” NOK 4 billion. This, without adding the expenditure to the regular State Budget.

In other words, this means heavy investments financed by oil money – but without touching the amount which is stipulated in the state budget. Still keeping in line with the action rule for the use of that source of income.

The grip was confirmed by the Leader of the Finance Committee, Henrik Asheim (Conservatives), in the daily radio magazine “the Political Quarter” on Friday.

Significant unrest

“There are two very specific reasons to consider solving it this manner. Firstly, because it is a state of emergency and secondly, it is an extraordinary situation,” Asheim explains.

Støre agrees that the events are extraordinary, but will still not open the wallet without further ado.

“The attack on the Government quarter and a frigate sinking, are undoubtedly unique events, but life is full of such. With the Progress Party, which is basically against the entire fiscal rule controlling the Ministry of Finance, this gives cause for considerable unrest,” the Leader of Labour tells NTB.

Not dismissive

Asheim says it’s about making some big investments in state-owned assets, without affecting other activities negatively. Støre is not completely dismissive:

“Labour won’t dismiss assessing extraordinary funding of these events out of hand. We, however, need to review the justification by the Government and professional assessments first. The action rule is fixed to all intents and purposes,” Støre replies.


The Member of Parliament for the Conservatives emphasises that if you spend NOK 4 billion below the State Budget line to buy a frigate, you don’t have to reduce the activity of the Norwegian Armed Forces with a corresponding amount.

Asheim stresses that this is something the Government considers to do, not something that must be done.

He further dismisses that it is appropriate to postpone billions towards combat aircraft and roads.

“We will not do that,” Asheim asserts. He emphasises that it would be unfortunate if such budgeting as the Government now allows for, spreads like wildfire.

The action-rule

The Government platform states that “the Norwegian State follows the principle of self-insurance. This entails that the main rule is that the state does not obtain insurance for their assets, but covers damage and losses when they arise. The Government will investigate and assess whether replacements, where the state is a self-insurer, can be entered as a [so called] 90 post in the State Budget.

«The proposal in the Government platform states that re-purchases, where the state is self-insured, can be entered as 90 posts in the State Budget. Is this in line with the current definition of the action rule limiting the use of oil revenues?» Rigmor Aasrud (Labour) asks in a written parliamentary question addressed to the Minister of Finance, Siv Jensen (Frp).

The (fiscal) action rule governs how much of the oil fund can be used annually over the State Budget, and it is currently set at 3 per cent of the fund’s total value.

Although the Solberg Government has moved the chalk line for the use of oil money down, from 4 to 3 per cent, the use of oil money has increased hugely since the bourgeois took over in 2013. This because the fund has grown accordingly.

Clearly contrary to the budget rules

Former Central Bank Governor, Svein Gjedrem, believes that the Government breaks the budget rules when they want to draw on funds from the oil treasure to be spent on the Government Quarter and a frigate.

“My main objection is that this is not a loan, but expenses that are not repaid. They are actual expenses that have full impact in the Norwegian economy. According to the budget rules, they must be covered by current income,” Svein Gjedrem tells VG.

Up to 2015, Gjedrem (68) was the Finance Councillor of Norway and chief executive of the bureaucrats in the Ministry of Finance. Prior to that, he was Governor of the Central Bank for twelve years.

“I’m glad they’ll only review it,” he concludes.

© NTB Scanpix / #Norway Today
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